ULG Ultimate Leis.

RNS Number:8908P
Ultimate Leisure Group PLC
22 January 2007

                           ULTIMATE LEISURE GROUP PLC



           #25M CONDITIONAL EQUITY RAISING AND WHITEWASH RESOLUTIONS



Ultimate Leisure Group plc (the "Company"), the bar and nightclub operator,
today announces that it intends to raise #25,000,000 by way of a conditional
issue of 14,792,900 new ordinary shares of a price of 169p per share,
representing a discount of approximately 5% to the closing price on Friday 19
January 2007.  The Company's two largest investors, Reuben Brothers Limited ("
Reuben Brothers") and the Dawnay, Day group ("Dawnay, Day"), have undertaken to
subscribe through associated companies for all such shares, 7,761,985 and
7,030,915 shares respectively, subject to the right of certain shareholders to
be issued New Ordinary Shares in proportion to their existing holdings (the "
Further Investment").



The Further Investment would increase the interests in relevant securities of
the Company of each of the Reuben Brothers and Dawnay, Day concert parties to
higher than 30 per cent., the level at which the Takeover Code normally requires
a general offer to be made to all shareholders. The Panel on Takeovers and
Mergers (the "Panel") has agreed to waive this requirement if shareholders
(other than the Reuben Brothers and Dawnay, Day Group concert parties) approve
on a poll the "whitewash" waivers at the EGM to be called in due course.



The Further Investment is subject to the completion of formal documentation and
the Board expects to send out a circular and notice of EGM with more details of
the Further Investment in the near future.



Reasons for the Further Investment



The Board believes that the Company has now reached the stage where more
substantial acquisitive growth may now be contemplated and it is reviewing a
number of acquisitions. In order to improve the Company's competitive position
to acquire such targets, the Company's two major investors, Reuben Brothers and
Dawnay, Day, have indicated that they would be prepared to support a new equity
issue.



The Board would prefer to invite all shareholders to participate in this equity
issue but reluctantly has concluded that the costs and complexities involved in
producing a Prospectus now necessary under securities laws would be
disproportionate to the benefit to be gained. The Board will, however, be
utilising the exemption from the requirements to produce a Prospectus in
relation to certain qualified investors who will be able to take part in the
Further Investment through a clawback mechanism. Further details of how
qualified investors can participate in the Further Investment and the procedure
for investing will be set out in the circular.









Concert Parties



The Panel has confirmed the existence of two separate concert parties. The first
concert party is the Reuben Brothers Concert Party, comprising inter alia,
Reuben Brothers together with Jacob Lyons and Stephane Nahum (both of whom are
non-executive directors of the Company and advisers to Reuben Brothers). The
Reuben Brothers Concert Party has an interest in 7,480,475 Ordinary Shares
representing 29.89% of the Company's voting rights at the date of this
announcement. On the assumption that all of the proposed New Ordinary Shares are
issued in accordance with the Further Investment and no New Ordinary Shares are
issued to any qualified investors, the Reuben Brothers Concert Party will hold
interests in the Company representing 38.3% of the voting rights of the enlarged
issued share capital of the Company.



The second concert party is the Dawnay, Day Concert Party, comprising inter
alia, Dawnay, Day Properties Limited, Starlight Investments Limited, fellow
subsidiaries within the Dawnay, Day Group, and KC Wong and Alka Bali (who are
both non-executive directors of the Company and employees of the Dawnay, Day
Group). The Dawnay, Day Concert Party has an interest in 6,775,919 Ordinary
Shares representing 27.07% of the Company's voting rights at the date of this
announcement. On the assumption that all of the proposed New Ordinary Shares are
issued in accordance with the Further Investment and no New Ordinary Shares are
issued to any qualified investors, the Dawnay, Day Concert Party will hold
interests in the Company representing 34.7% of the voting rights of the enlarged
issued share capital of the Company.



Principal terms of the Further Investment and use of Proceeds



The net proceeds of the Further Investment will be used to provide the Company
with the financial flexibility to make acquisitions of businesses and assets
that the Directors believe can add value to the Company. In the short term, the
funds will be held in interest bearing accounts or securities.



The Further Investment is conditional on both (i) the passing of the relevant
resolutions concerning the waiver of Rule 9 for both the Reuben Brothers and
Dawnay, Day concert parties and enabling the Directors to allot the New Ordinary
Shares at an EGM to be called by the Company and (ii) admission of the  New
Ordinary Shares to trading on AIM. The date of the EGM is yet to be finalized
but is expected to be held at the end of February 2007.





Mark Jones, Executive Chairman, said:



"With the repositioning of the business through an extensive investment in
refurbishment, marketing and training , largely completed we are now looking to
take the group forward to the next stage of its development. We are delighted
that our major shareholders have demonstrated their confidence in our plans. "





For further information please contact:







Ultimate Leisure
Mark Jones            Chairman                  0191 261 8800

Financial Dynamics
Ben Foster / Charles Watenphul                  0207 831 3113




                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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